- Louisiana Senator Bill Cassidy (R-LA), MD, has introduced legislation that would close hospital loopholes in the 340B Program, which helps low-income and uninsured patients access treatment and medications with fewer financial barriers.
The 340B Program allows participating hospitals that provide high numbers of uninsured patients discounted drugs. Drug manufacturers must supply these hospitals with discounted medications.
The program was intended to improve patient access to treatment without financial barriers, but that has not turned out to be the case, according to a statement from Cassidy’s office.
Through the 340B Program, providers are still compensated at the full Medicare and Medicaid rates, and there is no requirement stating that providers must pass the discounted savings onto their patients. This loophole allows hospitals and other providers to profit off of the 340B Program instead of aiding patients.
Hospital participation in the 340B Program has nearly tripled over the past ten years. Cassidy’s Helping Ensure Low-income Patients have Access to Care and Treatment (HELP ACT) aims to quell that issue.
“The 340B program is an important resource for hospitals serving low-income areas,” Cassidy said in a public statement. “But too often the program’s discounts are used to pad hospitals’ bottom lines instead of helping disadvantaged patients afford their treatments. This bill will increase transparency and accountability and help ensure these discounts reach patients.”
Several government watchdog agencies, including the Government Accountability Office (GAO), Office of Inspector General (OIG), and Medicare Payment Advisory Committee (MedPAC) have all found loopholes in the 340B Program. Many of these loopholes are due to lacking transparency that enable hospitals to inappropriately participate in the program.
Cassidy’s bill would seek to create transparency in program reporting requirements, ensuring that 340 B drugs are used to improve patient access to treatment. The bill would halt new 340 B enrollment for two years and require the HHS Secretary to create new reporting measures to which hospitals must adhere.
Not all hospitals would face the provisions presented in Cassidy’s bill. Rural hospitals, critical access hospitals, sole community hospitals, grantees, and PPS-exempt children’s or cancer hospitals could still enroll in the program. Most of those entities are exempt from all provisions in the bill.
The bill has been lauded by some healthcare industry stakeholders, including the Community Oncology Alliance (COA). The 340B Program is essential for creating a safety net for low-income or uninsured patients, but when it is used improperly patients still face the barriers to care that have previously hindered them, according to COA president Jeff Vacirca, MD, FACP.
“340B is an invaluable program for patients in need at community and safety-net providers, including rural hospitals,” said Vacirca, who is a practicing oncologist and the CEO of NY Cancer Specialists.
“However, after 25 years, it has gone horribly wrong,” Vacirca added. “I regularly hear about how the patients that 340B is intended to help are often actually being harmed by the program, cut off from timely and high-quality care by hospitals seeking to make profits from it. This is outrageous and must be stopped. Policymakers in DC need to act to ensure that we have a clear understanding of the scale of the 340B program, where funds are going, and accountability so that patients are directly benefiting.”
Research has shown that cost is one of the primary barriers to patient medication adherence. Safety-net programs, such as the 340B Program or Medicare Part D, can help patients access their medications because they pose a lesser cost burden.
Senator Cassidy’s bill has the potential to alleviate those burdens should it pass. Currently, the bill has only been introduced into Congress.